"HTC pays Microsoft (NASDAQ:MSFT) $5 for every phone it sells running Google's (NASDAQ:GOOG) Android platform, according to a research note from a Citi analyst.
The report, authored by Citi analyst Walter Pritchard, said the fee is a result of the patent licensing deal HTC signed with Microsoft in April 2010. The research note also said Microsoft is looking to receive between $7.50 and $12.50 per device from other Android handset makers in similar arrangements...
One reason for the litigation strategy, Citi analysts argue, is that the legal settlements resulting from such battles crimp the margins of Android handset makers, making Microsoft's Windows Phone 7 software more attractive by comparison. However, the research note does not discuss how much Microsoft gets per Windows Phone device sold. However, research firm asymco points out that, depending upon that variable, Microsoft could potentially be making more money from Android patent royalties than it has received from sales of Windows Phone devices. HTC sold 9.7 million smartphones in the first quarter, the large majority of which were likely Android phones."
